The US trade deal with Japan has sparked speculation about a potential European automotive deal. Japan committed to investing half a trillion dollars in the US, leading to market optimism. European automakers have investment plans in the US, but not on the same scale as Japan. Japan’s stock market is responding positively to the news.

Companies like BMW and Mercedes are optimistic about reaching a deal that allows for balancing imports and exports. The Japanese-US trade deal suggests room for negotiation on import duties for cars entering the US. This could benefit European automakers looking to export to the US market.

EU negotiators are considering removing their 10% duties on US car exports if the US reduces its duties on the sector to below 20%. The 15% duty agreed upon with Japan shows that a duty below 20% is feasible. This could pave the way for a potential trade agreement between the EU and the US.

Read more at Morningstar: European Automaker Stocks Surge Amid US-Japan Tariff Optimism